REP. STUTZMAN INTRODUCES REGULATION A+ IMPROVEMENT ACT

WASHINGTON, DC – Today, Congressman Marlin Stutzman (IN-03) introduced the Regulation A+ Improvement Act. The legislation will support the growth of small to mid-size businesses and expand investment opportunities for Americans across the country by increasing the offering limit for Regulation A Tier 2 offerings. These offerings provide a more accessible and cost-effective way for mid-sized and smaller companies to raise capital from a wider range of investors, with less government red tape and compliance costs.

The bill doubles the offering limit of Reg A Tier 2 offerings from $75 million annually to $150 million annually and requires the offering limit to be adjusted every two years to the nearest $10,000 to reflect the changes in inflation. 

This adjustment will help more mid-size or smaller companies raise capital, create growth, jobs, and make important investments in research and development.

Rep. Stutzman said the following about his legislation:

"Outdated limits on raising capital hinder the growth of mid-sized and small companies,” said Rep. Stutzman. “To increase competition and unleash economic growth, we must continue to provide pathways for companies to avoid the traditional, burdensome IPO process. My Regulation A+ Improvement Act will help more businesses in Indiana and across the country secure the critical investment they need to grow and thrive.”

Key Background:

Regulation A (Reg A) is an exemption from registration requirements under the Securities Act that applies to public offerings of securities. In 2015, with the enactment of the JOBS Act, Reg A was updated to allow companies to raise capital under two separate tiers of offerings. These two tiers of offerings, commonly referred to as Regulation A+ (Reg A+) include:

• Tier 1, for offerings of securities up to $20 million in a 12-month period, and not more than $6 million in offers by selling security-holders that are affiliates of the issuer;
• Tier 2, for offerings of securities up to $50 million in a 12-month period, with not more than $15 million in offers by selling security-holders that are affiliates of the issuer.
  • Under the Securities Act, the Securities and Exchange Commission (SEC) is required to review Tier 2 offerings limit and is authorized to increase this limit as it deems necessary. In 2021, Tier 2 was updated to allow companies to raise up to $75 million in a 12-month period by the SEC.